Protein arginine methylation is an emergent post-translational modification involved in a growing number of cellular processes, including transcriptional regulation, cell signaling, RNA processing and DNA repair. Although protein arginine methyltransferase 1 (PRMT1) is the major arginine methyltransferase in mammals, little is known about the regulation of its activity, except for the regulation induced by interaction with the antiproliferative protein BTG1 (B-cell translocation gene 1). Since the protein hCAF1 (CCR4-associated factor 1) was described to interact with BTG1, we investigated a functional link between hCAF1 and PRMT1. By co-immunoprecipitation and immunofluorescence experiments we demonstrated that endogenous hCAF1 and PRMT1 interact in vivo and colocalize in nuclear speckles, a sub-nuclear compartment enriched in small nuclear ribonucleoproteins and splicing factors. In vitro methylation assays indicated that hCAF1 is not a substrate for PRMT1-mediated methylation, but it regulates PRMT1 activity in a substrate-dependent manner. Moreover, small interfering RNA (siRNA)-mediated silencing of hCAF1 in MCF-7 cells significantly modulates the methylation of endogenous PRMT1 substrates. Finally, we demonstrated that in vitro and in the cellular context, hCAF1 regulates the methylation of Sam68 and histone H4, two PRMT1 substrates. Since hCAF1 and PRMT1 have been involved in the regulation of transcription and RNA metabolism, we speculate that hCAF1 and PRMT1 could contribute to the crosstalk between transcription and RNA processing.